Maurice "Hank" Greenberg has resigned from the board of American International Group, severing ties with the firm he built into one of the world's largest insurers but which has lately become mired in allegations of fraud.

The resignation is an abject end to Mr Greenberg's career. During almost 40 years at the helm of AIG, he became one of the most widely respected figures in the industry and at 80 years old was heading towards a comfortable retirement.

Instead, he was forced to stand down as chairman and chief executive in March as investigations into the firm began to gather pace.

At the end of last month New York attorney general Eliot Spitzer filed a lawsuit against him and former chief financial officer Howard Smith accusing them of orchestrating an accounting fraud designed to make the firm appear in better financial health. Both men have denied any wrongdoing.

In a brief statement released through his lawyers, Mr Greenberg said the allegations against him had made it impossible to carry out his duties as a director. "My decision to resign now results from my inability to receive information regarding the company and its operations necessary to fulfil my fiduciary duties," he said. "I wish the employees of AIG every future success."

Mr Greenberg had earlier said that he would remain on the company's board until its annual meeting.

At the end of last month AIG restated its financial results dating back to 2000, reducing earnings by more than 10%, almost $4bn (£2.2bn), and cutting the company's net worth by $2.3bn.

Investigations have focused on two deals with General Re, a reinsurance firm that is part of Warren Buffett's Berkshire Hathaway.

John Houldsworth, a former senior executive of the Dublin division of General Re, is also facing civil charges related to one of the suspect transactions.

According to the suit against Mr Houldsworth, brought by the securities and exchange commission, General Re transferred a block of business to AIG, allowing it to add $500m in premiums to its reserves. AIG allegedly paid General Re $5m in return.

The 2000 transaction was completed shortly after analysts had raised concerns about AIG's level of reserves.

According to the suit, Mr Greenberg took a close personal interest in the two contracts.

Mr Greenberg declined to answer questions from Mr Spitzer's office and the SEC, the US financial watchdog, using his right to avoid self-incrimination.